Glencore to Sell Copper Mines, Idle Zinc Production

Glencore has initiated a process to sell its Cobar copper mine in Australia and Lomas Bayas copper mine in Chile. The sale process is in response to Glencore receiving a number of unsolicited bids for these mines from various potential buyers, according to the company. In September, however, Glencore said it would consider selling assets to help raise cash when it promised to cut its debt by one-third to about $20 billion by the end of 2016. Concerns over Glencore’s debt has created huge fluctuations with its stock value recently, causing it to decline near 30% in one day in late September before recovering.

Analysts believe the mines could fetch $1 billion. Cobar is a high-grade underground copper mine and a concentrate plant in central western New South Wales, Australia. The plant throughput is approximately 1.1 million metric tons per year (mt/y) of ore and it produces approximately 50,000 mt/y of copper in concentrate. Lomas Bayas is an open-pit copper mine located in the Atacama desert, 120 km northeast of Antofagasta. The low-grade copper ore mined at this facility is processed by heap leaching and converted to copper cathode after processing through the SX-EW plant. The Lomas Bayas operation produces approximately 75,000 mt/y of copper cathode.

Glencore also announced a 500,000-mt reduction of contained zinc metal mine production across its operations in Australia, South America and Kazakhstan to preserve the value of its reserves at a time of low zinc and lead prices. These changes, which represent around one-third of Glencore’s annual zinc production, will reduce fourth quarter 2015 mine production by approximately 100,000 mt of contained zinc metal.

Glencore’s operations at Lady Loretta in Australia and Iscaycruz in Peru will be suspended and operations at George Fisher and McArthur River in Australia and various mine operations in Kazakhstan will reduce production levels.